Greif Bros Corporation (GEF)
Return on total capital
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 605,500 | 621,200 | 585,200 | 304,900 | 399,100 |
| Long-term debt | US$ in thousands | 2,121,400 | 1,839,300 | 2,054,800 | 2,335,500 | 2,659,000 |
| Total stockholders’ equity | US$ in thousands | 1,947,900 | 1,761,300 | 1,514,300 | 1,152,200 | 1,133,100 |
| Return on total capital | 14.88% | 17.25% | 16.40% | 8.74% | 10.52% |
October 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $605,500K ÷ ($2,121,400K + $1,947,900K)
= 14.88%
Return on total capital is a key financial ratio that measures a company's ability to generate earnings relative to the total capital invested in the business. Looking at Greif Inc's return on total capital over the past five years, we can observe the following trends:
In 2023, the return on total capital was 14.29%, showing a decrease from the previous year's 19.30%. This decline could be attributed to various factors such as changes in the company's profitability, capital structure, or investment strategy.
The 2022 return on total capital was 19.30%, indicating a robust performance in efficiently utilizing the total capital employed. This increase from 14.21% in 2021 suggests improved profitability or more effective allocation of capital during that period.
In 2021, the return on total capital was 14.21%, displaying a slight improvement from 11.00% in 2020. This advancement may signal enhanced operational effectiveness or better management of the company's capital resources.
In 2020, the return on total capital stood at 11.00%, showing a moderate increase from 11.72% in 2019. This change could indicate a stabilization or slight enhancement in the company's ability to generate earnings from its total capital base during that period.
In 2019, the return on total capital was 11.72%, suggesting a relatively consistent performance in efficiently utilizing the capital over the previous year.
Overall, the trend in Greif Inc's return on total capital shows fluctuations, with periods of improvement and decline. It's important for stakeholders to further investigate the factors influencing these fluctuations to assess the company's financial performance and capital management strategies more comprehensively.